"Liberation Day," A Blessing For Trump, A Trial For The World

WASHINGTON DC, WEDNESDAY - United States President Donald Trump is preparing to launch "Liberation Day" for the United States on Wednesday (2/4/2025) local time, or Thursday in Indonesia. For Trump, Liberation Day refers to the imposition of tariffs on U.S. trade partners.

Although from the beginning of his administration, Trump had implemented tariff policies for several countries, for many parties, "Liberation Day" is no different from "new pressure." The policy is feared to burden business actors worldwide, trigger uncertainty, and disrupt the global economy.

Many countries are likely to be affected because Trump does not distinguish between friends and foes. What has happened is that, in addition to China, even Canada and Mexico, which have trade agreements, have not escaped the "tariff targets" imposed by Trump.

White House trade advisor Peter Navarro stated that tariff policies would boost U.S. revenue by up to 600 billion USD per year. If this target is achieved, it would mark the largest tax revenue increase for the country since World War II.

"April 2, 2025, will be recorded as one of the most important days in modern American history," said Karoline Leavitt, White House Press Secretary.

At the launch, Trump will be accompanied by several cabinet members in the Rose Garden at the White House. Trump claims that the implementation of tariffs will stop the plundering of the U.S. domestic economy and industry.

Trump is highly eager to restore the Golden Age, the era of American glory. Trump has long boasted about his policy of raising tariffs as a solution to heal the U.S. economy from trade deficits with both allies and adversaries.

But as usual, Trump has kept the details of his policy under wraps. Trump has so far said only that tariffs would be applied in line with other countries' actions on U.S. products. Trump said on Monday that he would be generous with tariffs. But he did not elaborate.

What is clear is that in March Trump imposed a 25 percent tariff increase on steel and aluminum products from around the world exported to the US. Trump said he did not care if the price of imported cars went up.

Ahead of the Liberation Day deadline, Trump said he would impose a flat 20 percent tariff on all countries. But he said he would provide a third option, with certain countries getting different treatment.

On the other hand, critics see that the tariff burden will be borne by the American people who will buy daily necessities with additional prices due to the import tariff burden. This condition will trigger an economic recession in the US and also abroad.

Global markets have been volatile for days ahead of Trump's announcement. Most countries are hoping to have a dialogue with the US, although they have also prepared plans for retaliatory tariffs in response to the US move.

The move to raise tariffs has widened the gap between the US and its allies, who already have different views on security, defense and other areas. Trump's move is feared to trigger a global trade war, disrupt trade and disrupt the world economy.

So far, the European Union and Canada have expressed their readiness to retaliate against Trump's policy. "We will fight for the Canadian economy," Prime Minister Mark Carney said.

The European Union, which Trump has accused of hurting the US economy, said it was ready to negotiate but had prepared countermeasures against US tariffs if they went ahead. British Prime Minister Keir Starmer said he had productive talks with Trump.

Vietnam claims to have cut some import tariffs on US products to please Trump.

Meanwhile, economists are pessimistic about the effectiveness of “Liberation Day.” Stanford University economist Nicholas Bloom sees the nuances of uncertainty growing stronger. He believes Trump’s move will trigger the worst economic chaos since the Covid-19 pandemic passed.

When businesses are uncertain about where economic policy is headed, they hold on to cash and cut back on hiring. In times of uncertainty, consumers also cut back on spending, Bloom added. Virtually all sectors of the economy are slowing down.

“April 2 would reduce economic uncertainty if that is the final decision, but I would expect there to be a series of related economic policy announcements,” Bloom said.

Randy Carr, CEO of World Emblem, a company that makes badges, embroidered logos, and labels for companies, colleges and law enforcement agencies, has predicted that Trump’s 25 percent tariffs will affect the price of his products. Much of their products are made in neighboring countries and he has already announced price increases of at least 8 percent.

In February 2025, Carr postponed a $9 million investment that was originally planned for AI and online trading. He will reduce the company's spending amid the current uncertainty.

"We don't know whether we should reserve funds to deal with these tariffs. We don't know what will happen tomorrow Wednesday," Carr said.

Another company, Emerald Packaging, which makes a variety of packaging for Walmart and Kroger, is holding back investments, waiting for the economic turmoil from Independence Day to subside.

Matthew Luzzetti, an economist at Deutsche Bank, Germany’s leading bank, said that if “Liberation Day” is a dead end for tariffs, the impact of the global uncertainty it triggers will reduce economic growth by at least 1 percent for the next few quarters. “If this uncertainty continues, the impact will be multiplied,” Luzzetti said.

Meanwhile, US Chamber of Commerce and Industry Public Policy Director Neil Bradley said raising tariffs would hurt the economy. "Until there is clarity on the policy on April 2, then we can make adjustments and business plans. But getting certainty from a policy that is detrimental is not something positive," Bradley said. (AFP/Reuters)